• Topics

• Introduction

• NHB
• Types

• Growth

• Role of HFIs

• Securitization of loans

• Performance of HFIs

• Prudential Norms
• INTRODUCTION
• Housing is one of the basic human needs of the
• Housing is one of the basic human needs of the
• society. A better house leads to better standard of
• society. A better house leads to better standard of
• living of the people, which in turn makes their life
• living of the people, which in turn makes their life
• healthy & happy.
• healthy & happy.
• On the other hand, construction of new houses
• On the other hand, construction of new houses
• has vast potential of generating employment
• has vast potential of generating employment
• through backward & forward linkages. Realizing
• through backward & forward linkages. Realizing
• the importance of housing in the national
• the importance of housing in the national
• economy, institutional arrangements have been
• economy, institutional arrangements have been
• made during recent past for the provision of
• made during recent past for the provision of
• housing finance in India.
• Life Insurance Corporation has traditionally been
• providing housing loans to its policy holders &
• providing housing loans to its policy holders &
• housing finance companies have also been
• housing finance companies have also been
• engaged in such financing.
• engaged in such financing.
• The establishment of Housing Development
• The establishment of Housing Development
• Finance Corporation (HDFC) & Housing & Urban
• Finance Corporation (HDFC) & Housing & Urban
• Development Corporation (HUDCO) in the public
• Development Corporation (HUDCO) in the public
• sector gave a great boost to housing finance in
• sector gave a great boost to housing finance in
• India.
• India
During recent years commercial banks have
been
permitted to enter into this field. Some of the
permitted to enter into this field. Some of the
commercial banks have been permitted to
enter
commercial banks have been permitted to
enter
into this subsidiaries.
into this subsidiaries.
The establishment of NHB in 1988 as the apex
The establishment of NHB in 1988 as the apex
bank in this field was a significant step towards
bank in this field was a significant step towards
developing a sound & efficient housing finance
in
developing a sound & efficient housing finance
in
India.
India
National Housing Bank (NHB)
National Housing Bank (NHB)
Established in 1988 under NHB Act, 1987
Established in 1988 under NHB Act, 1987
Operate as a principal agency to promote
Operate as a principal agency to promote
HFIs, at both local and regional levels
HFIs, at both local and regional levels
To provide financial & other support to
To provide financial & other support to
them.
them.
The main features:
Capital
Capital
Authorized & paid up capital is 350 crore, fully
Authorized & paid up capital is 350 crore, fully
subscribed by RBI.
subscribed by RBI.
The authorised capital can be increased up to
The authorised capital can be increased up to
Rs. 2000 crore by the Govt in consultation
Rs. 2000 crore by the Govt in consultation
with the RBI.
with the RBI.
Management
Management
A chairman & a Managing Director
A chairman & a Managing Director
2 directors from amongst experts in the field
2 directors from amongst experts in the field
of housing, architecture, engineering,
of housing, architecture, engineering,
sociology, finance, law, management &
sociology, finance, law, management &
corporate planning or in any other field,
corporate planning or in any other field,
special knowledge of which is considered
special knowledge of which is considered
useful to the NHB.
useful to the NHB.
2 diectors
2 diectors
Business
Borrowing and acceptance of deposits
Loans in foreign currency
Advisory services
Funds
Power to inspect
Power to acquire rights
TYPES OF HOUSING LOANS
Home Purchase Loans
Home Purchase Loans
Home Improvement Loans
Home Improvement Loans
Home Construction Loans
Home Construction Loans
Home Extension Loans
Home Extension Loans
Land Purchase Loans
Land Purchase Loans
Bridge Loans
Bridge Loans
Balance Transfer
Balance Transfer
Refinance Loans
Refinance Loans
Stamp Duty Loans
Stamp Duty Loans
NRI Home Loans
NRI Home Loans
Home Purchase Loans
Home Purchase Loans
There are the basic home loans for the purchase of a new
There are the basic home loans for the purchase of a new
home. If you want to buy a flat in some society or some
home. If you want to buy a flat in some society or some
already built house, banks and HFCs sanction you home
already built house, banks and HFCs sanction you home
purchase loans for this process.
purchase loans for this process.
Home Improvement Loans
Home Improvement Loans
These loans are given for implementing repair works and
These loans are given for implementing repair works and
renovations in a home that has already been purchased by
renovations in a home that has already been purchased by
you. It may be requested for external works like structural
you. It may be requested for external works like structural
repairs, waterproofing or internal works like tiling and
repairs, waterproofing or internal works like tiling and
flooring, plumbing, electrical work, painting, etc.
flooring, plumbing, electrical work, painting, etc
Home Construction Loans
These loans are available for the construction of a new home.
These loans are available for the construction of a new home.
The documents required by the banks or HFCs for granting
The documents required by the banks or HFCs for granting
you a home construction loans are slightly different from the
you a home construction loans are slightly different from the
home purchase loans. Depending upon the fact that when you
home purchase loans. Depending upon the fact that when you
have brought the land, the lending party would or would not
have brought the land, the lending party would or would not
include the land cost as a component, to value the total cost
include the land cost as a component, to value the total cost
of the property.
of the property.
Home Extension Loans
Home Extension Loans
Home Extension Loans are given for expanding or extending
Home Extension Loans are given for expanding or extending
an existing home. For example addition of an extra room, etc.
an existing home. For example addition of an extra room, etc.
For this kind of loan, you need to have requisite approvals
For this kind of loan, you need to have requisite approvals
from the relevant municipal corporation.
from the relevant municipal corporation.
Land Purchase Loans
Land Purchase Loans are available for purchase of land for both home
Land Purchase Loans are available for purchase of land for both home
construction or investment purposes. So, you can be granted this loan
construction or investment purposes. So, you can be granted this loan
even if you are not planning to construct any building on it in the near
even if you are not planning to construct any building on it in the near
future.
future.
Bridge Loans
Bridge Loans
Bridge Loans are designed for people who wish to sell the existing home
Bridge Loans are designed for people who wish to sell the existing home
and purchase another. The bridge loan helps finance the new home, until
and purchase another. The bridge loan helps finance the new home, until
a buyer is found for the old home